Weekly Lessons

Baka Sakali

December 10, 2019

You open ur trading account. You look at top gainer. You said to ursel. “Ay ang taas nya nyan. Ayoko nyan” You look at top losers and think “bah dami bagsakan ah, saan kaya dito pwede mag baka sakali?” You see a stock that was previously 50 and now its 20 pesos na lang. You say to urself “pag eto bumalik sa dati more than double my money toh. Kahit 30% up lg ok nku dun” So you proceed to buy it only to find out after a month that its now 15 pesos. Then another trader comes in and say “bah 15 na lang dati 30 toh, pg bumalik sa dati double pera ko nito kahit 20% na lang ok na”

If wala kang system you will fall sa ganyang trap. They call it 52 WEEK LOW TRAP.
Nothing is more destructive to amateur investors than thinking that a stock trading near a 52-week low is a good buy.

Rsi oversold level does not mean the stock is about to go up. It simply means people has been selling the stock either rapidly or for a while now. Downtrending stock could stay on oversold levels for months or years. I will discuss rsi more sa YT vid at blogs soon kasi part yan ng maduming merkado.

Now balik sa topic.

Kaya nga may tinatawag na dont catch falling knives for it will hurt you. I dont and cant blame you. Its not just a simple “pagbabakasakali” na mindset. It stems from a deeper one. Mga movies na napanood mo growing up kung saan yung bida inaapi muna bago mg make a huge comeback. Mga family members mo often buying “uy mura na tong damit na to naka sale 50% off”.
When I tell traders about this idea lagi reaction is “eh paano naman ang stocks like Phen or Ani or Smph? Nagbagsakan din yun pero look at them now”

Well, you are talking of a different approach. Growth investing is different. Different mindset at different timetable. If you see a stock na bumagsak but the potential or growth potential is huge then by all means go for it. Pero if you see a stock na bumagsak. If e base mo lang sa price alone then yan eh napakalaking pagkakamali. Value at price is totally different.
The next time ma tempt ka mag baka sakali sa top losers I want you to think about the chart sa baba.

Digest this lesson. Learn from it. I hope it helps.

One Comment

  • IAN

    Value at price is totally different. – this one got me real hard.

    Quick short story – amidst this pandemic, I saw the price of $PAL – and though to myself exactly the same words I’ve read in here. “Oy mura na to oh, dating XX yung price. Ganito nalang siya today” (I mean, afford ko na). So I bought some shares (adhering to the 8k rule). I didn’t even consider na that the aviation industry is hardly hit by this pandemic too. I didn’t consider how long it may take for this industry to get back on their feet. I was too focused on the price. Nothing else.

    Ending? Ipit parin ako sa $PAL – cause, even if I don’t admit to myself – I’m still guilty of thinking like this: baka sakali.

    Clearly I have a lot to learn pa – from cutting my losses, and from making sure na I don’t just look at the price of those bottom stocks. This experience taught me of the dangers if you do just that.

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